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Outsourcing

Outsourcing Assessment
In consideration of outsourcing some of Kudler’s operation, the company must determine several factors if migrating to outsourcing will benefit them. In examining the advantages and disadvantages of outsourcing, Kudler must first conduct a thorough analysis of its current internal process or function that will help guide them in their decision to outsource. Three major factors needed to be evaluated in the internal analysis of Kudler’s current operations are:
Gather and obtain performance data on existing systems
Determine the level of stability of current systems and labor hours needed to maintain systems internally.
Examine the true costs of hiring a vendor to perform its current functions to determine if reduction of cost and quality is being met.
Advantages and Disadvantages of Outsourcing
The following lists the advantages and disadvantages of outsourcing:
Advantages
Provides cost savings and reduce overhead expenses.
It will allow Kudler to focus on broader issues occurring within the company while other tedious tasks are being handled by external matter experts.
Most outside vendors has access to newer technology which may be a budget constraint for Kudler to invest currently in.
Eliminates time consuming processes in development and training certain functions internally.
An effective approach to risk management to collaborate with skilled outsourced services that is more knowledgeable to provide more refined mitigation control.
Transferring services to be controlled by skilled and talented individuals in that area of expertise.
Disadvantages
Communication between Kudler and its potential vendors if processes or functions are outsourced to a vendor whom resides outside of the country.
Time zone differences that can delay communication required by Kudler and potential vendors.
Outsourcing can result in fewer positions being available within Kudler Fine Food due to functions being shifted and outsourced to external...